S.F. Counselor Headed for Jail In Medical Claim Fraud / He must also pay back $2.8 million to government

Chronicle Staff Report

Published 4:00 am, Saturday, April 17, 1999

1999-04-17 04:00:00 PDT San Francisco -- A former City College of San Francisco counselor will begin serving a four-year prison sentence next month for stealing $2.8 million from the federal government through bogus medical reimbursement claims.

Thomas Yuen Chen Lai will start his sentence on May 14. In addition to his imprisonment, Lai has been fined $10,000 and will have to pay back the $2,875,000 he stole through the scheme.

Lai, a 57-year-old San Francisco resident, was indicted early last year by a federal grand jury in San Francisco. In the indictment, he was accused of submitting 59 false claims to Letterman Army Hospital at the Presidio from 1991 to 1994.

Lai pleaded guilty to the charges last October after negotiations with federal prosecutors. In his plea, Lai admitted to the scheme and to enlisting the assistance of a former accounting clerk at the hospital, Marian Wong.

Wong pleaded guilty to similar charges last August and is already serving a 27-month prison sentence for her part in the fraud.

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The two allegedly obtained valid claim forms, substituted phony doctors' names, changed the amount of the claims and resubmitted the claims, according to the indictment. Checks were sent to a mail drop and then laundered through bank accounts controlled by Lai, the indictment alleged.

According to prosecutors, each of the claims was submitted under the names of Gary Ching, Lai's cousin, or Gregory Brown, one of his acquaintances. Neither Ching nor Brown are doctors, and neither was a participant in the scheme.

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